We've been making a fair number of announcements recently - on
both the product and the partnering front. That's generated a lot
of interest, and a fair number of questions. So I thought I'd
take the opportunity to deliver this overview and the upcoming
focused discussions on what makes Sun tick in a video format. Let
me know if this is useful, or what else we can do to keep you
informed via the comment field at the bottom.

We're approaching the end of our fiscal year, and given all the
swirl in the economy, I thought it worthwhile to restate where
Sun's headed as a company, to let customers, partners, employees
and investors see and understand where we're …

These are my spoken notes from last week's earnings call -
rather than recraft them, I figured I'd simply republish.

_______________________________

And thank you all for joining us this afternoon.

I'll start with some perspective on our Q2 results and the
current climate, then follow-up with commentary on our products
disclosure - slides 6 and 7 in the slide deck. Then I'll turn it over to Mike
Lehman (Sun's CFO) for commentary on financial metrics, and an
update on the restructuring plan we announced back in November.

There are a couple of bookstores in my neighborhood. They could
not be more different from one another.

The first is known to focus on best seller lists, to promote
popular books, and use displays and traditional retail techniques
to drive business. They seem to do well, year in, year out. The
other bookstore is more of a community treasure, beloved by the
neighborhood, with a focus on the (thoughtful) insights of their
staff. Those insights are delivered via small note cards appended
to shelving throughout the store, where books are displayed
alphabetically, with library-like neutrality.

As consumer spending slows across the world, a variety of "brick
and mortar" retailers are clearly feeling the impact. Foot
traffic is slowing, and it's getting harder to balance debt laden
real estate portfolios and fickle consumer trends.

For consumer product manufacturers, retail distribution is key -
it's how you get in front of a customer. It's why the big PC
manufacturers are all working hard to score deals with big
retailers (or build their own retail outlets) around the world.

But making money on PC's is tough - for most PC makers, you're
remarketing someone else's operating …

The bursting of the internet bubble was good for the computer
industry.

Many of us didn't like the medicine, but I can't remember a
single customer upset at the idea of paying $20,000 for computing
infrastructure that used to cost them $100,000. The price compression came from open source
software, and a move toward general purpose servers, and resulted
in companies formerly making 65% gross profit on products (Sun
among them) facing a new reality.

We announced our earnings today, and put specifics around our
preannouncement from a week ago.

We also greatly increased the transparency of Sun's business by
providing line item detail surrounding our most important product
categories (and we broke out core elements of our Software
business for the first time). If you'd like to listen to our
earnings call, just click here - in addition, here's a quick
synopsis of the quarter and our business overall.

At a corporate level in Q1, Sun's revenue was down 7% year over
year. Growth in our emerging …

I was with a customer last week, who leads technology and
operations for one of the world's largest companies. We were
talking through his priorities for the upcoming year, and on a
page filled with various traditional priorities (consolidation,
energy management, disaster recovery, regulatory compliance) were
two interesting words.

"Open Source."

I asked what that meant, why it was there. He said they'd done an
audit of the firm's development activities, and found an
overwhelming number ("hundreds") of open source

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